The pitch looks official, but ...

Homeowners usually pay close attention to annual property tax bills and often struggle to decipher the details and fine print. Adding to the confusion, some receive solicitations in the mail from companies charging a fee for property tax services that homeowners can perform themselves for free.

The Los Angeles County Office of the Assessor is cautioning homeowners to be wary of companies offering to file applications on the owners’ behalf for a property tax or other exemption. County officials said that paying such a fee is unnecessary and that a flood of such third-party applications can create a backlog of paperwork, sometimes resulting in a delay in eligible homeowners receiving their benefits.

That was the case with a backlog in 2003 and 2004 when the Chicago-based Property Tax Assessor Records Corp. allegedly misled thousands of Southern California homeowners to believe they had failed to claim property tax exemptions -- even when some already had, or were not entitled to them -- according to the county’s Department of Consumer Affairs. The $7,000 exemption, which is listed on the tax bill, saves an eligible homeowner $70 annually in taxes on a principal residence.

Using a name and forms that closely mimicked those used by county assessors’ offices, the Chicago company sent out about 581,000 solicitations to homeowners in San Diego, Los Angeles and Riverside counties, informing them that they were eligible for a property tax exemption, according to San Diego Deputy Dist. Atty. Tricia Pummill. More than 21,000 homeowners responded.

The company offered to fill out the applications for the homeowners for $25. Respondents also were charged a $24 “valuation” fee unless they checked a box opting out. County assessors provide exemption forms at no charge.

In March, the San Diego district attorney’s office filed a lawsuit, which the California attorney general’s office later joined, claiming that the Chicago company used deceptive business practices, including false advertising and billing some homeowners for services that they did not request. A survey by the district attorney’s office found that victims thought the solicitation was from a county office, despite a disclosure in small print stating that it was not.

“Some victims were college professors, lawyers, well-educated people,” Pummill said. “They scrutinized the forms but didn’t see the disclosures in the fine print.”

The case was settled in July by the company, without admitting liability or wrongdoing. So far, 598 respondents in the three counties have been reimbursed a total of $25,198, representing the bulk of the claims, Pummill said. Under the terms of the settlement, the company must now plainly disclose on its forms that it is not a government agency, and its Chicago address and phone number must be prominently displayed.

“We disagreed with the suit’s allegations,” said Beth Fancsali, the Wildman, Harrold, Allen & Dixon attorney who represented Property Tax Assessor Records Corp. in the lawsuit. “The company believes that it brings valuable information to homeowners who might not otherwise be aware of the exemption and offers a service to assist them in obtaining the exemption.”

The company, which still operates out of Chicago, did not solicit Southern California homeowners in 2004, Fancsali said. But on Tuesday, Patricia Hennings, chief of exemptions services for the Los Angeles County assessor, received from a homeowner a letter of solicitation from the same company.

There are other companies that employ tactics similar to those of the Chicago firm, Pummill said. Some offer to file homestead exemptions, which prevent a home from being sold to satisfy certain debts; others offer to file an appeal to the assessor’s office to lower a homeowner’s tax liability. Homeowners can file both these applications for free.

“Many of these companies market their product and say you need to take advantage of their services to protect yourself from future legal problems or get your property tax lowered,” said Pastor Herrera, director of the county’s Department of Consumer Affairs.

The profusion of claims that resulted from the Chicago-based solicitations, along with increased home sales during that period, meant that some homeowners did not get the exemption in a timely fashion, Hennings said.

Instead of receiving the usual 8,000 claims per year -- each one usually takes about two months to process -- the assessor’s office was overwhelmed with about 45,000, plus hundreds of phone calls from confused homeowners seeking information about tax exemptions and the solicitation they had received. The backlog lasted six months, until the middle of 2004, Hennings said. More than half of those who applied were entitled to the exemption.

Homeowners routinely receive an application from the assessor’s office for the tax exemption shortly after purchasing a residential property and the deed is recorded. They should fill out and return the application even if they see the exemption on their current, annual tax bill, Hennings said.

If the previous owner had the exemption, it will remain in effect for that year. The new owners must apply for the exemption for subsequent years, but only once. To be eligible, the home must be the principal residence.

If the prior owner did not have the exemption or the house is newly constructed, the owners must apply for the exemption and, if eligible, will get credit for that calendar year. The permanent exemption, however, will show up on the property tax bill the following year. For example, the tax bill for a property purchased this year will show a permanent exemption on the property tax bill for 2006-07.

Owners who bought years ago and still have not applied for a tax exemption may do so at any time, but it is not retroactive. If they apply by Feb. 15, 2005, they will receive a full exemption for this year, and it will appear on their October 2005 bill.

Many owners don’t apply for the exemption, Hennings said, because they discard the application when it arrives in the mail.

“One woman came in the other day and said she never received the application,” Hennings said. “But she pulled out her file of documents from years ago, when she bought the house, and there was the application.” She added that homeowners can call the assessor’s office to request an application in the event they did not receive one.

To avoid confusion about mail solicitations, Herrera recommends homeowners read over all documents offering services for a fee, looking for local addresses and phone numbers. It is not illegal for a company to solicit fees for filing applications for homeowners, but it is illegal if they misrepresent themselves, leading homeowners to think the company is a government agency. It also is illegal to charge homeowners for services before they are delivered.

“Be alert,” Herrera said. “If you’re not sure, call the proper government agency and find out if the solicitor represents a legitimate agency.” Homeowners also should ask whether there is a fee to file such applications.

Homeowners with questions about property tax exemptions should contact their local assessor’s office. In Los Angeles County, call (888) 807-2111; Orange County, (714) 834-2727; Ventura County, (805) 654-2181; San Bernardino County, (909) 387-8308; Riverside County, (909) 955-3900; and San Diego County, (619) 236-3771.